Chapter 1

Chapter 4
Introduction to
Sponsorship: Concepts,
Objectives, and
Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved.
Sponsorship’s Role
• Another Promotional Tool for Marketers
• Sponsorship Should Have a Synergistic Effect
on a Marketer’s Promotional Efforts
• Sponsorship Fits within the Promotional Mix
• Integrated Marketing Communications (IMC)
Integrated Marketing Communications
(IMC) Plan
Personal Selling
Sales Promotion
Public Relations / Publicity
• Key Is How They All Work in Harmony
• Sponsorship Is NOT Advertising
Evolution of Sponsorship Motives
• Early Sponsorships Were Ego-Driven
– CEO likes golf; company sponsors golf event
• Focus Shifted to Philanthropic Motives
– Sponsorship was a way to contribute to a cause
• Most Sponsorships Today Focus on ROI
– Sponsorship as an investment, not an expense
Advertising’s Advantages
• Persuasive Message
– Words and Images Used to Convey Ideas
• Standardization
– Everyone Receives an Identical Message
• Guaranteed Size of Audience Reached
– Circulation; TV Ratings; Radio Ratings
Advertising’s Advantages (Cont’d)
• Evaluation of Effectiveness
– Measures such as CPM Can Be Applied
– Measure the Impact on Sales
– Concept Testing Prior to Using Advertisement
• Turnkey
– May Be a Stand-Alone Tactic That Is Not
Supported by Other Elements of the IMC
• A Relationship between a Marketer and a
Property in Which the Marketer Pays a
Cash or In-Kind Fee in Return for Access
to the Exploitable Commercial Potential
Associated with the Property
• Many Types of Properties that Represent
Sponsorship Opportunities for a Marketer
Sponsorship’s Advantages
Internal Morale
Sales Opportunities
Access to Live Audience
Sponsorship Categories
• Sports
• Entertainment, Tours & Attractions
• Cause-Related Marketing
• Festival, Fairs & Annual Events
• The Arts
• Associations and Membership Organizations
Sponsorship Spending by Category
Sports (69%)
Entertainment, Tours & Attractions (10%)
Cause-Related Marketing (9%)
The Arts (5%)
Festival, Fairs & Annual Events (4.5%)
Associations and Membership Orgs (3%)
* Rounding creates small statistical error (IEG)
Worldwide Sponsorship Spending
• Drop in Table 4.2 Here
Key Sponsorship Concepts
• Participants
– Sponsor – Party Seeking Association (Visa)
– Sponsee – Property Owner (e.g. FIFA)
• Linkages
– Self-Evident – adidas products used in event
– Strategic – Visa Credit Cards and FIFA have
similar target markets
Key Sponsorship Concepts
• Leveraging – Must Support Sponsorship
with Additional Strategic Elements (i.e.
Event-Oriented Advertising)
• Ambush Marketing – Non-Sponsors often
try to Create the Misperception among
Consumers That They Are a Sponsor
(Diminishes Value for the Actual Sponsor)
Re-Visit Types of Sponsorships
• Traditional
– Straight-forward Association
• Special Cases of Sponsorship
– Endorsements – Personality Sponsor
– Venue Naming Rights – Building Sponsor
– Licensing – Sponsorship Involving Trademark
Sponsorship Objectives
• Drive Sales
• Improve Image
• Create Greater Awareness
• Provide Hospitality Opportunities
• Enhance Employee Morale
Drive Sales
• Sustainable Competitive Advantage Via the
Association with the Sponsee
– Visa over MasterCard (No presence at World Cup)
• Merchandising Opportunities
– Selling Coca-Cola Products at the Olympics
• Shape Consumer Attitudes
– Firestone after negative PR (Indy 500)
Drive Sales (cont’d)
• Overcome Advertising Restrictions
– Bans against Tobacco Advertising
• Cut Through Advertising Clutter
– Not Competing with Broadcast Advertising
• Reach Small Segments and Niches
-Small specialized properties (local festival)
Improve Image
• Attain Positive PR
– Support Seen as Helping the Sponsee
• Viewed as a Good Corporate Citizen
– Contribution to a Popular Sponsee
– Especially for Causes or Local Events
Improve Image (Cont’d)
• Shape Consumer Attitudes
– Reach New Target Market
– Selected Property Portrays Different Image
• Philanthropy
– Donations Viewed Favorably by Public
Create Greater Awareness
• Increased Visibility
– Ability to Reach More Potential Customers
– Mass Reach to Introduce New Product
– Mass Reach to Inform of New Brand Name
Provide Hospitality Opportunities
• Entertain Customers, Prospects &
Suppliers – Reinforce Relationships
• Opportunity to Attend Event
– Tickets; parking
• Provision of Various Amenities
– TV monitors, restrooms; premium seating
Enhance Employee Morale
• Entertain Employees
– Use of free tickets & hospitality areas
– Reward high performers
• Sense of Pride
– Feeling of “My company cares”
• Employee Involvement
– Feeling of “I’m part of the corporate team”
Importance of Objectives
• Drop in Table 4.5 Here
Sponsorship Components
Category Exclusivity
Right to Use Event Trademarks and Logos
Distribution Rights
Hospitality Areas
Complimentary Advertising
Free Tickets
Sponsorship Components (Cont’d)
Right to Purchase Additional Tickets
Link on the Event Web Site
(Sponsorship) Designation
Inclusion in Event Promotions
Access to Property Mailing List / Database
Right of First Refusal
Category Exclusivity
• A Guarantee that the Sponsor’s
Competitor Will Not Be Allowed to Become
Involved with the Sponsee
• Pepsi-Cola is a Sponsor of the World Cup
of Cricket. Category Exclusivity Provides
Assurance that Coca-Cola Will Not Be
Involved in Any Official Capacity
• Actual Signs Identifying and Promoting the
Sponsor at the Event Venue
• Helps to Reinforce the Relationship in the
Consumers’ Minds
• May Be Actual or Virtual Signage
• There is a Concern About Signage Clutter
Right to Use Event
Trademarks and Logos
• Events Generally Have Terms and
Symbols That Are Legally Protected
• It Is Illegal to Use These Intellectual
Properties Without Permission of Owner
• Sponsors Use These in Advertising, on
Packaging, and on Promotional Items
Distribution Rights
• Right to Use Event as a Distribution Outlet
• Distribution of Free Samples of Product at
Event Venue
• Ability to Sell Products at Event Venue
Hospitality Areas
• Facilities to Entertain Selected Individuals
• On-Site Hospitality
– Luxury Suites
– Temporary Facilities
• Off-Site Hospitality
– Temporary or Leased Facilities
Complimentary Advertising
• “Free” Advertising for the Sponsor
• Often Paid as Part of Rights Fees
• Examples
– TV Advertisements
– Radio Advertisements
– Print ad in the Event Program
– Mentions by Announcers – PA or Media
Free Tickets
• Admission to the Sponsored Event
• Important for Events that Typically Sell Out
• May Vary According to Sponsorship Level
– High level sponsors receive more free tickets
Right to Purchase
Additional Tickets
• Valuable for Sold Out Events
• May be Used Even When Free Tickets Are
Not Provided to the Sponsor
• May be Bought at Discount if Event Is Not
Expected to be Sold Out
Link on the Event Web Site
• The Ability for Visitors to the Event’s Web
Site to Click on an Icon That Will Take
Them to the Sponsor’s Web Site
• Check out the Web Site for FIFA and the
World Cup of Soccer
• How the Sponsor Can Refer to Itself in Its
Own Marketing Efforts. Examples Include:
– Presenting Sponsor
– Title Sponsor
– Official Sponsor
– Marketing Partner
– Official Supplier
– Regional Supporter
Inclusion in Event Promotions
• The Event Is Likely to Promote Itself
Through Traditional Media. It Is to the
Sponsors’ Benefit to Be Identified in the
Event’s Advertising and Marketing Efforts
• Helps to Reinforce the Relationship
between the Sponsor and the Sponsee in
the Minds of the Consumers
Access to Property
Mailing List / Database
• Sponsor and Sponsee Likely Have Very
Similar Target Markets
• Access to Sponsee’s List Will Provide
Sponsor with Access to Potential Buyers
• Many Properties Have Lists of Ticket
Buyers and Members of Fan Clubs
Right of First Refusal
• Current Sponsor Is Provided Opportunity
to Renew Its Sponsorship for the Next
Period Prior to the Solicitation of New
Sponsors by the Sponsee
• Evaluate New Terms; Effectiveness of
Existing Sponsorship; Potential Actions by
Competitor if Sponsorship Is Terminated
Which Components
Are Most Valuable?
• Drop in Table 4.7 Here
Controversial Issues
• Do Higher Prices Result from Sponsorship?
• Do Large Multinational Companies Have an
Unfair Advantage?
• Sponsorships May Seem Illogical (No Fit)
• May Feature Unwholesome Products
Closing Capsule
• Sponsorship Has Emerged as a Key
Element of Many Firms’ IMC Plans
• Sponsorship Spending Is Growing, But
Only Accounted for Approximately $43.5
Billion (US) in 2008
• Most Sponsorship Money Goes to Sports
Closing Capsule
• Sponsorships Should Benefit Both the Sponsor
and the Sponsee – A Win-Win Partnership
• Sponsorship Components Should Be
Considered Tools That Will Help the Sponsor
Achieve Its Objectives
• Category Exclusivity and Venue Signage Are
Viewed as the Most Important Components
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